April 10 (Reuters) - Czech headline inflation stuck at the central bank's target of 2% in March for a second straight month after easing sharply to begin 2024, statistics office data showed on Wednesday, leaving a path to further interest rate cuts.
Analysts had forecast a slight drop in the year-on-year inflation rate, to 1.9%, while the March result was well below the Czech National Bank's forecast of 2.9% in its winter outlook.
The central bank maintained its easing cycle in March with a 50-basis point reduction to its two-week repo rate, dropping it to 5.75%, down 125 basis points since last December.
The bank has been cautious in accelerating its cutting pace with the crown trading much weaker than expected and services prices still an upside risk.
In March, consumer prices rose 0.1% month-on-month, with services prices rising 0.4%. Year-on-year, services prices were up more than 5%, statistics office data showed.
Food prices were the main segment to drop in the consumer basket, the statistics office said.
Inflation in the Czech Republic, like elsewhere in central Europe, has fallen quickly in recent months after a surge to double-digit rates in recent years amid food and energy price jumps. (Reporting by Jason Hovet in Prague; Editing by Sharon Singleton)
